Ruble devaluation spreads panic among Belarusians

10:09, May 26, 2011

The devaluation of the Belarusian ruble has spread panic throughout the country, with people clearing store shelves and queuing up at currency exchange offices trying to protect their savings.

Belarusians are trying to get rid of their rubles by buying consumer goods and even stocking up on food supplies. Other people spent several weeks in lines outside exchange offices in order to pay back currency loans to banks.

Most Belarusian state-owned industries and the government are trying to keep its currency reserves for vital imports as gas, oil, medicine.

Belarusian President Alexander Lukashenko promised that the national currency will remain stable following the devaluation enacted a day earlier, but experts warned the Belarusian ruble will continue to weaken if Russia doesn't provide a quick loan.

Russian Finance Minister Alexei Kudrin said Tuesday that Belarus can get the total of 3 billion U.S. dollars in loans from Eurasian Economic Community over the next three years, including the first 800 million that could be delivered next month. He added that Belarus could earn another 7.5 billion U.S. dollars by privatizing its industries, most of which are state-owned.

The Belarusian ruble fell in value against the dollar currency by 55 percent following the devaluation and the World Bank said this devaluation was a world record in the last 20 years. The new official rate is 4,930 rubles per dollar, up from the previous 3, 155. But the perceived value of the local currency is much lower - on the black market it takes 6,000 rubles to buy a dollar.